In their first transaction as partners, GB Lodging and Provenance Hotels have purchased the Ambassador Hotel in New Orleans, and together, the new owners will kick off an image-enhancing renovation of the 165-room lodging destination.

In their first transaction as partners, GB Lodging L.L.C. and Provenance Hotels have purchased the Ambassador Hotel in New Orleans, and together, the new owners will kick off an image-enhancing renovation of the 165-room lodging destination.

Carrying the address of 535 Tchoupitoulas St., the Ambassador is housed within a structure that made its debut as a coffee warehouse in the 1880s, and the property’s origins will not be forgotten in the makeover process that will transform the asset into a three-star lifestyle property with a popular food and beverage venue. “Our design process will likely focus on creating an authentic New Orleans lodging establishment that respects and pays homage to the City and the history of the building,” Rodriguez said.

While GB Lodging and Provenance are no strangers to successful hotel repositionings, they are both new to the Big Easy–the majority of GB Lodging’s properties are in in New York City and the bulk of Provenance’s assets are in the Pacific Northwest. However, they are well aware of the state of the city’s hotel market. “The city of New Orleans is undergoing a fundamental transformation that is positively impacting all segments of hotel demand, as well as enhancing the city’s main economic drivers,” Dionis J. Rodriguez, Executive Vice President, Acquisitions & Development, GB Lodging, told Commercial Property Executive. “As a result, we believe that it is the right time to invest and benefit from the expected growth of the market as whole.”

The size of the New Orleans hotel market has rebounded to its pre-Hurricane Katrina days, as have hotel occupancy and visitation, the latter of which, in 2012, reached the highest level since 2003, according to a recent report by HVS Consulting and Valuation.

“The key demand generators are the convention center, leisure/tourism related to festivals, carnivals, sporting events and the general appeal of New Orleans as unique leisure destination as well as corporate travelers,” Rodriguez added. “Projects underway, such as the $2 billion biotechnology campus, will further diversify the base of hotel demand and enhance the market’s performance.”

GB Lodging and Provenance expect to complete the renovation of the Ambassador in the fall of 2014.